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Wind power in upswing, stiff competition ahead

German wind energy is booming after the government decided to phase out nuclear energy in favor of renewable energies. Despite strong growth in 2012, turbine manufacturers expect stiff headwinds from Asia.

Wind power capacity in Germany rose by 26 percent in the first half of this year, as 414 new turbines went into operation, industry lobby group VDMA Power Systems said Wednesday.

The new turbines added 1,000 megawatts - the equivalent of one nuclear power plant - to Germany's existing wind power capacity of 30,000 megawatts, produced by 22,664 installations.

Noting that wind power already made up about nine percent of Germany's energy needs, VDMA Power System's Chief Executive Thorsten Herdan said, however, that offshore wind farming was "behind expectations" this year.

At the group's annual news conference, Herdan called on the German government to speed up efforts to connect offshore wind farms to the national power grid, and quickly resolve legal liability questions concerning unconnected offshore farms that lie idle.

German energy giant RWE announced last month that it would postpone a 166-turbine offshore wind project because grid operators were unable to guarantee that the wind farm in the Baltic Sea would be connected by the time it was finished.

A 15-month delay in connecting one of its wind farms, RWE said at the time, had resulted in losses of more than 100 million euros ($123 million).

Apart from "homemade" problems in Germany, VDMA Power Systems, also sees clouds emerging on international markets.

"There won't be any more growth in Europe, and for the US market we even expect a substantial contraction," Herdan said.

In addition, German turbine builders were feeling market pressure from Chinese manufacturers, which he said expected to increase in the coming years as China would try to sell its overcapacities on global markets.